Published: Dec 7, 2007
Updated: Jan 21, 2015

Jim Brown, VP of Freedom Tax Relief, gives a how to on IRS tax debt settlement options. First off, you must be in compliance with the IRS before you can apply for tax relief. In order to be in compliance, you must file the last six years worth of returns. From there, a tax settlement firm will negotiate with the IRS to create a five-year installment agreement. If you are unable to pay the tax owed, they can negotiate for an offer in compromise to pay the IRS debt and remove tax liens from your record. CLICK HERE to learn more.

Video Transcription;

"Hello, I’m Jim Brown I am the vice president of Freedom Tax Relief and the topic I am speaking about today is tax resolution. The first step for tax resolution for an IRS income tax debt is to be in compliance. What that means is that your tax returns have to be filed with the IRS for at least the last six years. Now once those returns are filed, we can go ahead and move ahead with the compliance and the resolution. What resolution means is that we are going to get the amount that you owe to the IRS either into a payment plan, an installment agreement, or we are going to look to settle that tax debt. So let’s talk about IRS installment agreements.

Once the returns are filed and we know how much you owe, depending on how much you owe, we can do a five year payment plan with the IRS if your tax debt is less than $25,000. If it is more than $25,000 then we are going to have to negotiate with the IRS based on what your monthly income and based on monthly expenses are and negotiate a payment plan based on the IRS criteria. Now if you are all filed and you can’t do a monthly payment plan to the IRS then we look at another alternative to resolve your tax debt and that’s an offer in compromise. We do a lot of those and that’s where the IRS settles for less than you owe. There we must show the IRS what your monthly income is what your monthly expenses are, and what your assets are. We have to show the IRS that you are not able to make a monthly payment and then we can have the IRS reduce the amount you owe by the settlement, the offer in compromise, that process for it to go through can take six to nine months. During that time all collection is on hold but once the procedure is over you would settle for less than you owe, you would get a fresh start, any liens would be removed and you would move forward as long as you continued to file and pay for the next five years. So in a nutshell that’s it. Get filed either get into a payment plan or do an offer in compromise. These are ways to resolve your IRS tax debt."